Reuters has reported that Saudi Telecom Company (STC) is the front runner in acquiring 55 percent of fixed-line operator Turk Telekom.
The report added that the Turkish government could acquire the $3.9 billion stake if those talks fail.
The potential deal comes as Oger Telecom, Turk Telekom’s biggest shareholder, faces increasing pressure from creditor banks after missing debt repayments of $290 million in both September and March on a $4.75 billion loan.
Three sources said that STC is seen as the most likely buyer, with two of the sources saying that the Turkish government could consider using a public institution to acquire the holding if the talks fail.
One of the sources said that as things stand, “only STC shows a clear interest in the acquisition,” adding that there are several interested Gulf companies but only STC has entered negotiations.
“The government may play an active role as a buyer with a public institution, in the case that STC does not buy,” the source said.
No one was available to comment at Oger’s offices in Turkey. STC declined to comment, as did Turk Telekom, while Turkish government officials were not immediately available for comment.
Oger is a unit of Saudi Arabian construction giant Saudi Oger, which itself is facing a multibillion-dollar debt restructuring. STC already holds an indirect 35 percent stake in Oger’s Turkish arm.
The government, which ultimately holds nearly 32 percent of Turk Telekom, wants the operator of the national telecoms grid to be owned by a financially stable company.
“Turk Telekom is a strategic and important company. It will not be left to its fate for sure. Public institutions would intervene when needed and this option is still a matter of consideration,” another source said.
